Released Fed Minutes Supportive of Higher Gold Prices

The minutes from the September FOMC meeting were released today. They indicated an elevated level of concern by Federal Reserve members not conveyed in either the statement released immediately following the conclusion of the September meeting, or the following press conference held by Chairman Jerome Powell.

In fact, according to Reuters, not only did the majority of Federal Reserve policymakers support the need for an interest rate cut in September, but the minutes also revealed that there remain divided on the forward path of their monetary policy.

“The readout of the meeting, released on Wednesday, also showed that the Fed agreed it would soon need to discuss increasing the size of its balance sheet following ructions in short-term money markets. Fed Chair Jerome Powell announced an imminent expansion of the central bank’s assets on Tuesday.”

If you recall from yesterday’s commentary, we brought in the popular saying, “If it walks like a duck, talks like a duck, and quacks like a duck, it probably is a duck”. However, after reading the minutes from mid September’s FOMC meeting I think it would be more appropriate to say that the Federal Reserve members need to “call a spade a spade”.

According to Wikipedia to call a spade a spade is to describe something clearly and directly. “Rather than using oblique and obfuscating language, just "tell it like it is". While it is absolutely understandable that Chairman Jerome Powell needs to walk a thin line to appropriately convey his message without setting off major alarms, he not doing a good job of it. Without any question for the most part Chairman Powell has been able to convey his message concisely with the necessary transparency.

However, it seems it is times like these the message Chairman Powell is conveying seems to be diluted from magnitude of the message.

Wishing you as always, good trading,